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Reputation in Team Production

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Author Info

  • Glazer, Amihai

    (Department of Economics, University of California, Irvine)

  • Segendorff, Björn

    (Dept. of Economics, Stockholm School of Economics)

Abstract

Consider team production with two people. Each is characterized by a prior distribution that he will do Right or Wrong. After the outcome of the project is observed, these probabilities are updated. When output depends on the weakest link in production, following project failure the posterior probability that a person did Right declines with the probability that the other worker did Right. The same holds when output depends on the best shot in production and the team effort succeeded. A leader concerned about his reputation may therefore prefer to work with a person unlikely to do Right.

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Bibliographic Info

Paper provided by Stockholm School of Economics in its series Working Paper Series in Economics and Finance with number 0425.

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Length: 16 pages
Date of creation: 21 Jan 2001
Date of revision: 01 Mar 2001
Handle: RePEc:hhs:hastef:0425

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Keywords: Reputation; team; competence;

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